UK 4G spectrum sale delayed

Britain’s largest ever spectrum auction has been delayed as carriers O2, Vodafone and Everything Everywhere hinted at legal action.

The three have the most to gain from a delayed 4G sale and have told Ofcom that they may go to court if the watchdog announced terms of the auction this month as planned.

The airwaves are being sold as 4G, and licences will be reserved for mobile phone carriers to help cope with mobile broadband demand.

Ofcom was expected to publish the terms of the auction this month, but according to The Guardian there were ” veiled threats of legal action” from a number of carriers and it will not now be ready until November. This means the auction can no longer begin as planned.

But a court case would slow things down even more and could be a killer for the smaller mobile carriers such as Three.

Part of the problem is that the older companies have spare spectrum which Ofcom in January gave them permission to reallocate to data. However the smaller carriers don’t.

Three had to compete by offering unlimited broadband access to customers for a fixed monthly fee. This has stuffed up its capacity to expand its data traffic as fast as its rivals.

The government wants things to move fast too. One of its problems is that it promised universal broadband access by the next election, expected in April 2015. Mobile would be the only way to fudge this promise by offering mobile broadband in the place of wired connections.

It also would like to have the cash that such an auction would generate.

Ofcom said that there were a number of technical and competition issues such as Freeview which needs to be relocated before 4G can be rolled out. It seems no matter where it’s taking hold, spectrum auctions are a messy business.

But David Dyson, chief executive of Three warned that any significant delay would further weaken competition to the detriment of UK consumers. He called on Ofcom and the government to develop a clear plan to make sure that everything does not go pear shaped because of the narrow self interest of the bigger telcos.